Swamp Notes: How protectionism got trendy
Digest
This podcast delves into the increasing trend of protectionism in US politics, particularly in the context of the 2024 presidential election. The discussion highlights how national security concerns are being used to justify protectionist policies, exploring the political motivations behind this trend and its potential impact on trade relations. The podcast examines the case of Nippon Steel's attempted purchase of US Steel, highlighting the contradictions in the Biden administration's use of national security concerns to block the deal. It analyzes the political motivations behind the administration's protectionist policies, considering the influence of unions, voters, and the changing economic landscape of Pennsylvania. The podcast also explores the perspective of European allies on the growing trend of protectionism in the US, highlighting the challenges posed by US policies for European businesses and the potential impact on trade relations.
Outlines
Protectionism and the 2024 Election
This episode introduces the topic of protectionism in US politics and its relevance to the 2024 presidential election. The discussion focuses on the growing trend of protectionism, its justifications, and its potential impact on trade relations.
The Nip-on-Steel Case and National Security
The podcast examines the case of Nippon Steel's attempted purchase of US Steel, highlighting the contradictions in the Biden administration's use of national security concerns to block the deal. The discussion explores the potential impact on jobs and the broader definition of national security in this context.
Global Perspectives on US Protectionism
The podcast analyzes the political motivations behind the Biden administration's protectionist policies, considering the influence of unions, voters, and the changing economic landscape of Pennsylvania. It also explores the perspective of European allies on the growing trend of protectionism in the US, highlighting the challenges posed by US policies for European businesses and the potential impact on trade relations.
Keywords
Protectionism
Economic policy that aims to protect domestic industries from foreign competition through measures like tariffs, quotas, and subsidies. It often prioritizes domestic jobs and national security over free trade.
National Security
A broad concept encompassing the safety and well-being of a nation, often used to justify protectionist policies. However, the definition of national security can be subjective and subject to political interpretation.
Trade Wars
Conflicts between countries involving the use of trade barriers, such as tariffs and quotas, to protect domestic industries and gain an advantage in international trade.
Global Supply Chains
Networks of interconnected businesses and organizations involved in the production and distribution of goods and services across different countries. Disruptions to global supply chains can have significant economic and geopolitical consequences.
Bipartisan Consensus
Agreement on a particular issue or policy by members of both major political parties, often indicating a strong public sentiment or shared national interest.
Electoral Campaigns
Organized efforts by political candidates to win elections, often involving public appearances, advertising, and fundraising to persuade voters.
Economic Diversity
The presence of a wide range of industries and economic activities within a region or country, reducing dependence on any single sector and promoting resilience to economic shocks.
Trade Relations
The economic and political interactions between countries regarding the exchange of goods, services, and investments. Strong trade relations are essential for global economic growth and stability.
Q&A
How has the trend of protectionism in US politics evolved, particularly in the context of the 2024 election?
The trend of protectionism has accelerated under both the Trump and Biden administrations, fueled by national security concerns, global supply chain disruptions, and a shift in voter sentiment away from globalization.
What are the key differences in the trade policies proposed by the Trump and Harris campaigns?
Trump's plans are more radical, including a 60% tariff on Chinese imports and a 10-20% tariff on all imports. Harris's approach is less aggressive, but both candidates favor more protectionist policies than previous administrations.
How does the Nip-on-Steel case illustrate the complexities of defining national security in the context of trade policy?
The Biden administration's decision to block the deal, citing national security concerns, contradicts the arguments made by the companies involved, highlighting the subjective nature of national security and its potential use as a pretext for protectionism.
What are the political motivations behind the Biden administration's protectionist policies, and how do they relate to the changing economic landscape of Pennsylvania?
The administration's policies are influenced by pressure from unions, particularly steelworkers, who are a key constituency for Democrats. However, the focus on manufacturing jobs may not be as relevant in a state like Pennsylvania, which has become more economically diverse.
How are European allies reacting to the growing trend of protectionism in the US, and what are the potential implications for trade relations?
European allies, initially hopeful for a less contentious trade relationship under Biden, are concerned about the continued hawkish approach towards China and the impact of US policies like the Chips Act and Inflation Reduction Act on European businesses. They expect a difficult trade relationship regardless of who wins the 2024 election.
Show Notes
Democrats and Republicans have taken a protectionist turn on trade policy over the past few years. They say it’s to protect national security, but that argument doesn’t always hold up. Just look at this week’s announcement from vice-president Kamala Harris that she doesn’t support the purchase of US Steel by Japan’s Nippon Steel. The FT’s economics editor, Sam Fleming, and Washington bureau chief, James Politi, join this week’s Swamp Notes to explain why both parties are leaning into “Made in America”.
Mentioned in this podcast:
How national security has transformed economic policy
Joe Biden set to block Nippon Steel’s takeover of US Steel
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Swamp Notes is produced by Ethan Plotkin, Sonja Hutson, Lauren Fedor and Marc Filippino. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. Special thanks to Pierre Nicholson.
Read a transcript of this episode on FT.com
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